by Jan Michael Carpo, Reporter
Security Bank Corp. is setting its sights on a significant profitability boost, targeting a return on equity (ROE) of approximately 10% by 2025.
This ambitious goal will be pursued through a multi-pronged strategy encompassing continued expansion of both physical and digital channels, cost optimization, and a renewed emphasis on customer-centric solutions, according to bank executives.
“It’s not going to be a straight line, but obviously, the intent of the bank is to continue manifesting better profitability,” stated Eduardo Olbes, Chief Financial Officer of Security Bank.
Olbes indicated that the bank’s performance has steadily improved throughout 2024, with even greater ROE gains anticipated. “We are in a better position as of the third quarter than we were at the beginning of 2024, and we see even more improvement in terms of ROEs,” he added.
In December last year, the bank also tried to strengthen its foothold in the consumer finance sector by purchasing a 25% ownership interest in Home Credit Philippines (HCPH) from MUFG Bank Ltd. for approximately P11 billion. The deal, which is still subject to regulatory approvals, is expected to be finalized by the first quarter of 2025.
Security Bank’s new pledge: “Better Banking”
Central to Security Bank’s strategy is its commitment to its “Better Banking” pledge, a philosophy that prioritizes employee empowerment and the delivery of tailored customer solutions.
Sanjiv Vohra, President and CEO of Security Bank, emphasized the bank’s dedication to this principle. “We’ll continue to execute on our goal to be the most customer-centric bank in the Philippines, leveraging our technology to provide customized solutions, in line with our vision for 2025,” Vohra affirmed.
This customer-centric approach will be significantly bolstered by enhancements to the bank’s digital offerings. Security Bank is planning to launch two new mobile banking applications in the first half of 2025.
One app will cater specifically to corporate clients, while the other will be designed to meet the unique needs of micro, small, and medium-sized enterprises (MSMEs). These dedicated platforms aim to provide more streamlined and efficient banking experiences for these key customer segments.
Further expanding its digital capabilities, Security Bank intends to integrate a wealth management feature into its mobile banking platform by late 2025 or early 2026. This addition will allow customers to conveniently manage their investments and financial planning directly through the app, offering a comprehensive suite of financial services at their fingertips.
This move aligns with the growing demand for digital wealth management solutions and positions Security Bank to capture a larger share of this burgeoning market.
Enhanced profitability not solely reliant on revenue growth
The bank’s pursuit of enhanced profitability is not solely reliant on revenue growth.
According to sources, Security Bank will also focus on cost optimization measures to improve its bottom line. By streamlining operations and enhancing efficiency, the bank aims to maximize profitability without compromising the quality of its services.
This focus on cost management, combined with the projected revenue growth from its expanded digital offerings and customer-centric approach, forms the foundation of Security Bank’s plan to achieve its 10% ROE target.
Industry analysts will be closely watching Security Bank’s performance in the coming year to see if its strategic initiatives translate into tangible results. The successful implementation of its digital expansion plans and the effectiveness of its customer-centric approach will be key indicators of the bank’s ability to achieve its ambitious profitability goals.
The competitive landscape of the Philippine banking sector is dynamic, and Security Bank’s commitment to innovation and customer satisfaction will be crucial for its continued growth and success. The bank’s focus on technology, particularly the development of specialized mobile banking apps, signals a clear intention to capture a larger share of the increasingly digital-savvy banking population.
Whether this strategy, coupled with cost optimization, will be enough to reach the 10% ROE target by 2025 remains to be seen, but it undoubtedly positions Security Bank for continued growth and a stronger presence in the Philippine financial market.